Does the carrier have the ability to update or reset your balance, device and access at the SIM level? Do they even have to? Seems like running out of credit basically unregistered your device or something.

Not a stupid question at all. No one has fallen from the sky knowing everything.

As nieldk said, the direct answer to your question is yes. But I believe the real answer is it does not have to. "This service is/is not available" is a network internal state. Voice and SMS worked immediately after topping up. All the phone needed to do was try. I am happy to wager that as far as the provider is concerned, data was available immediately too. It was the phone's fault for not even trying. Once data was disabled, the phone got itself into a "this network has no data" state and the only way to get it out of that state was a power cycle.

__________________In particle accelerators atoms are indeed not only touching each others. But banging together in a massive explosive orgasm.
-- nieldk in a TMO post

Voice and SMS worked immediately after topping up. All the phone needed to do was try. I am happy to wager that as far as the provider is concerned, data was available immediately too. It was the phone's fault for not even trying. Once data was disabled, the phone got itself into a "this network has no data" state and the only way to get it out of that state was a power cycle.

Ahh, so it was only the data connection that did NOT work, your voice&SMS were resatored when you updated credit to the account? I missed that bit of information in the original question!

Now this leads to some interesting questions since basically all of the traffic both uplink and downlink are "data", just handled a bit differently...

Did you check what the established connection was, 2G, 3G, 4G?
Could it have been possible for example that your device was expecting to get 3G/4G data connection but network forced it to drop to 2G; that would have made CS calls and SMS available but prevented data calls?

Ahh, so it was only the data connection that did NOT work, your voice&SMS were resatored when you updated credit to the account? I missed that bit of information in the original question!

Sorry, I did not make it explicit and I realize it may not be obvious to those not familiar with how prepaid cards work.

Voice must be available all the time. One reason is so that you can always call emergency services, even without credit. Another one is so that you can call the credit top-up number and type in your voucher details. You can also call any other free number. And lastly, you can still receive calls and texts even without credit, although I know of providers who cut you off completely when you do not top up for a certain time (3 months, a year, or more, depending on the provider).

Did you check what the established connection was, 2G, 3G, 4G?

That's the funny thing. It showed 4G in the status bar, right next to the network icon with the star in it. Pity I did not take a screenshot

My provider does not even support 2G. It is a relatively new one who never bothered with 2G to start with.

__________________In particle accelerators atoms are indeed not only touching each others. But banging together in a massive explosive orgasm.
-- nieldk in a TMO post

If I may ask, any connection or just data? How long did you wait before you gave up and forced it manually? Seconds, minutes, days? Did it ask for the SIM PIN?

The way I see it, there are at least three separate issues in my use case:

Once the mobile data is lost for whatever reason, the phone makes no attempt to recover it and needs a manual intervention.

Querying the mobile network for the data connection appears to be done only at the SIM card registration.

SIM card registration (including the PIN prompt) is done only on powering up.

I don't have a PIN on my SIM, do I cannot answer that question.
But it remains in that status until I force it manually. Sometimes I only noticed the next day.
I don't know if I can receive phone calls in that state but I cannot make calls and cannot send SMS text messages. However, I receive SMS messages in this state sometimes.

Only the XPeriaX shows this behavior. The same garage was OK with the Jolla 1 and the Jolla C. I haven't tried with recent updates on these devices, though. Maybe a Sailfish update broke it altogether and it's not just a XPeriaX issue...